An alternative-trading-system matches orders like an exchange but registers as a broker-dealer, which spares it exchange rulemaking duties while subjecting it to Reg ATS. Operators must file a public Form ATS-N describing how the venue works, who may access it and how orders interact.
Volume thresholds trigger extra duties, including fair access requirements and heightened systems standards once a venue exceeds a defined share of trading in a security.
Example: a dark-pool crossing 4% of a stock's consolidated volume operates under standard obligations. Cross the 5% threshold and it must grant fair access on non-discriminatory terms rather than picking participants — a real constraint for venues that market themselves on excluding toxic-flow.
Related: alternative-trading-system, dark-pool, reg-nms, trade-reporting-facility